DRAM-Maker Expects Price Correction by End of 2021

DRAM prices going up, woman holding memory stick
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During Taiwan's Nanya Technology Corporation's Q3 results presentation last Friday, president Dr. Pei-Ing Lee said he expects DRAM pricing to undergo a downwards correction by year end, compensating from recent DRAM pricing increases on a global level. This stems from the current market and supply chain conditions, which might actually be conspiring towards this predicted decline.

Despite demand remaining strong throughout staple DRAM-consuming products (such as general consumer electronics, servers, and smartphones), "We are expecting the DRAM market [to] enter short-term, minor correction in Q4, 21," concluded Lee. The company may, however, be in a particularly vulnerable position when it comes to its ability to sustain higher ASP (Average Selling Price) on its products, due to  its focus on speciality DRAM. The company supplies the usual suspects when it comes to DRAM chips - such as the office and enterprise and smartphone sectors; however, its other focuses, namely on automotive, home and entertainment (set-top boxes, IoT, and others) and enterprise (for networking and and infrastructure) have been facing consistent supply issues, which likely led to these remarks from Nanya's president.

Nanya Technology Corporation is usually ranked fourth amongst the world's DRAM makers, behind Samsung, SK Hynix, and Micron. It doesn't compete at the same level as those manufacturers - Statistica placed its Q1 2021 market-share at a mere 3%, which is well below Samsung's 42%, SK Hynix's 29% and Micron's 23% share of the market. Considering Nanya's market share and its president's expectations, however, it's possible that the big three players will soon find themselves in the same situation. Nanya and its 3% market share certainly have more difficulty in securing materials towards DRAM manufacturing in this market than the three giants it competes with, which would naturally have preference due to their much higher volumes. An incoming DRAM price reduction due to oversupply has already been predicted by industry analysts DRAMeXchange, Gartner, and IDC - so Nanya isn't the only company facing lowered revenues in the face of current events. Considering the general direction for higher pricing in all things consumer electronics, at least one of those parts facing price reductions is definitely good news for consumers - even if they aren't for investors and company's bottom lines.

Francisco Pires
Freelance News Writer

Francisco Pires is a freelance news writer for Tom's Hardware with a soft side for quantum computing.